IFLR 1000
The Guide to the World's Leading Financial Law Firms

While not as resilient as the country's economy, the M&A market is showing signs of recovery. Firms note that buyers are stimulating the market, German companies are cash rich and banks have built up a capital base and can afford to back them again so, says one partner, "generally there is financing available".

"I think a confidence has returned to the players. Everyone was shocked after the financial crisis and looking to sort their portfolios out, definitely on the German side of the market, now people are very confident about their ability to service debt," says one partner.

A lack of targets is the main hindrance. "In Germany the real economy recovered pretty well last year [2010]. That somehow took away the pressure from sellers to put assets on the block. In particular, and as long as, they feel that the valuation levels are not back at a level they consider to be something appropriate," says a lawyer.

While the level of distressed work has subsided, firms expect more to come from the financial sector, citing the heavily subsidised Hypo Real Estate, which was bailed out in July 2010 on condition the bank would divest of 85% of its business, as one example, as well as two of the savings banks, Bayern LB and West LB, which are likely to sell assets.

The hostile takeover bid for Hochief by Spanish construction company ACS, and the more amicable merger between Deutsche Börse with the New York Stock Exchange, illustrate a new interest from foreign investors in acquiring German assets. "I think we saw more interest from corporates outside Germany buying in to Germany," says one lawyer. Another agrees: "The firm sees quite a lot of inbound M&A from the US and, interestingly China, and India."

On the legislative side, the German takeover directive is due for review at the end of this year, an issue which has become a highly politicised since the acrimonious hostile takeover of Hochtief that was dragged out for nine months and culminated in the resignation of the German construction group's supervisory board.

Currently under German law a prospective buyer is required to make a tender offer once it holds 30% of a company's shares, but if it fails it does not have to make any additional bid and can continue to increase its stake, without seeking shareholder approval. According to one corporate partner "the takeover directive is due to be reviewed by the commission by the end of this year. It may be also that the German legislator will look more closely at the German take-over code. No one would be surprised if there were changes."

"For the German market, you will have trouble to find a law firm that is this helpful and as international," says one client of Freshfields. "I have worked with US and English firms but Freshfields has very strong German roots and these partners are the quality we expect."

Another client working with Andreas Fabritius says: "Excellent lawyer, experienced, very high expertise in German take-over law; and, very helpful in considering what the legal pitfalls could be and in what our task would be."

"In terms of volume, in terms of quantity and quality of the deals, they probably have the biggest share in the German market," says one competitor.

The largest secondary [private equity M&A] on the market in 2011 saw Michael Haidinger lead a team to advise Liberty Global, the international cable company, on its €3.16 billion acquisition of Kabel Baden-Württemberg, Germany's third largest cable operator. The German operator was purchased from private equity firm EQT in March 2011

The firm also represented Hochtieff on the nine month takeover saga with ACS which started in September 2010. Ludwig Leyendecker advised Hochtieff on ACS's €4.1 billion hostile bid, which culminated in a capital increase subscribed to by Qatar Investment Holding, allowing the Qataris to purchase a 9.1% stake and raising the price of the takeover. ACS eventually gained control in June by gradually building up its share ratio.

Barbara Keil led a team advising Evonik Industries on the sale of a 51% stake in Evonik Steag for €3.1 billion to a consortium of seven municipal utility companies, while Henning Oesterhaus acted for Deutsche Bahn as the national rail network sold its subsidiary Arriva to a consortium led by Ferrovie dello Stato in partnership with Cube Infrastructure for €340 million.

"It's very partnership orientated, it's very client-driven," says one client of Hengeler Mueller's M&A team. "It's a big firm but you don't get the feeling it's one of the big houses like Clifford or Freshfields, so it's still very customer focussed and very friendly. It doesn't give the feeling that it's a big machine," says another.

Most recently a team led by Matthias Hentzen and Thomas Meurer advised RWE on sale of majority stake in European transmission grid operator Amprion as part of an on-going restructuring and divesture project. In December 2010, the firm had advised RWE on the sale of Thyssengas, which operates the German supra-regional gas transportation network.

Hentzen and Meurer have also been working for Rolls-Royce on its joint acquisition with Daimler of specialist engine builder Tognum for €3.4 billion in May 2011.

Burkhardt Meister and joint managing partner Daniela Favoccia acted for Deutsche Bank on the acquisition of Deutsche Postbank in 2010. Meister was again active in December 2010 for Australian logistics company Brambles, advising on the voluntary takeover of the Dutch-German packaging systems supplier IFCO Systems.

On the technology side, Intel sought the firm's assistance in its acquisition of the Wireless Solutions Business of Infineon Technologies while Sanyo engaged the firm for the sale of its global semiconductor business.

Shipping is a sector that is still suffering in the wake of the crisis in Germany and the firm advised technology solution provider Thyssen Krupp on the sale of its 71% stake in Hellenic Shipyards.

Gleiss Lutz's M&A practice significantly expanded through the firm's merger with boutique Rittstieg in October 2010. The firm now has two offices and six additional corporate partners in Hamburg.

Competitors respect Gleiss and see the firm as deserving of its place in the second tier: "Gleiss is a fine German firm and has a good market share," says one.

On the sell side, Gleiss has been active for long-standing client Infineon on the sale of its mobile communication chip business, Wireless Solutions, to Intel Corporation for $1.4 billion. Signed in August 2010, the worldwide carve-out was conducted in parallel with several potential buyers. Ralf Morshäuser, who had already advised Infineon on the sale of its Wireline business to Golden Gate Capital in 2009, closed the deal in January 2011.

A deal highlight for the firm came in December 2010. EDF, Europe's biggest power generator, agreed to sell its 45% stake in German utility Energie Baden-Wuerttemberg (EnBW) for €4.7 billion to the German state. Martin Schockenhoff led a team from the firm's Frankfurt office advising the buyers on this deal and the subsequent takeover bid for EnBW.

ACS's takeover of Hochtief could have global ramifications and Gerhard Wegen and Christian Cascante played their part in the notorious bid, advising Australian construction company Leighton, a subsidiary of Hochtieff, on the implications of the deal.

Another notable piece of work saw Jan Bauer advise retailer Bortelli on the planned acquisition of insolvent German organisation Karlstadt.

The market fully supports Linklaters' ranking and sees the firm pulling away from its closest rivals: "Linklaters have had a very good run this year," says one. "Linklaters should be in band two or even one from what they do on the energy side in the M&A market place. They are making good progress," says another peer. The general consensus was, however, that the firm is on the brink of the first tier but not quite at that level. One lawyer attributed the firm's success to a specific partner: "Ralph Wollburg is one of the country's top M&A partners so Linklaters, by virtue of him, deserve that place," says the lawyer.

In terms of securing significant mandates, Linklaters' M&A practice is certainly nipping on the heels of the two firms ranked above. The firm was engaged by Deutsche Börse to advise on the planned unification with the NYSE. Wollburg and Nikolaos Paschos led the advising team.

Peter Erbacher and Stephan Oppenhoff advised the Spanish construction group ACS on the German aspects of its bid for Hochtief, which culminated in it gaining a majority shareholding in June 2011 after a failed hostile takeover bid of €4.2 billion in February.

In a notable cross-border transaction that is yet to be finalised, Wolfgang Sturm led a team advisong Deutsche Postbank on the sale of its Indian subsidiary, Deutsche Postbank Home Finance to a buyer consortium led by Dewan Housing Finance, a rival mortgage broker.

Allen & Overy's M&A ranks have been bolstered by the addition of three new partners. Christian Eichner joined the Düsseldorf office from Hogan Lovells in 2010, while Nicolaus Ascherfeld and Alexander Veith were promoted to the partnership in the firm's Hamburg and Munich offices in 2011.

Partner Helge Schäfer has been advising the container shipping line Hapag-Lloyd as German tour operator TUI, a 50% owner of Hapag-Lloyd, attempts to sell its stake.

On the buy side partner Michael Ulmer has been advising two pharmaceutical companies: Merck on the acquisition of the global microbiological monitoring business of the listed Biotest, which has assets throughout Europe; and Alliance Boots, on the takeover offer of the German pharmaceutical distributor Andreae-Noris Zahn (ANZAG).

In another notable transaction, Hartmut Krause is counselling Morgan Stanley in its bid for a majority stake in Süd-Chemie, which is being sold by One Equity Partners.

A headline deal for Baker & McKenzie saw it involved in the battle of two rival construction companies, as the Spanish ACS bid to take over the German Hochtief. Nikolaus Reinhuber advised Southeastern Asset Management on selling its stake in Hochtief in February 2011 for €125 million.

A team lead by Udo Henkel advised Siemens subsidiary Osram during the acquisition of Siteco Lighting and automotive supplier Mahler on the purchase of Behr Group. The deals closed in March 2011 and August 2010, respectively.

The firm's largest transaction closed in December 2010, advising Dover Corp on its acquisition of NXP Semiconductor Sound Solution business.

Cleary Gottlieb Steen & Hamilton represented EDF in the sale of its 45% stake in EnBW to Land of Baden-Württemberg for €4.7 billion. Partner Stephan Barthelmess worked in conjunction with the firm's Paris office on the sale.

The firm also acted as counsel to American Express in its $685 million acquisition of Loyalty Partner, a marketing services company, from Palamon Capital Partners, Metro and other sellers in March 2011. In the same month a team led by Oliver Schröder advised Bâloise Beteiligungs-Holding in the acquisition of Wilhelm Herrmann Assekuranz and Wilhelm Herrmann Assekuranz Makler by way of an investment vehicle.

The firm was also counsel to ASM Pacific Technology in its acquisition of Siemens Electronic Assembly Systems from the company's holding group.

Hogan Lovells bolstered the ranks of its corporate practice in July 2010 hiring Broich Bezzenberger partners, Karin Arnold and Thomas Keul and of counsels Martin Greiser, Michael Vette and Gerold Bezzenberger.

Acting alongside the firm's capital markets and finance lawyers, the corporate team advised FMS Wertmanagement on the transfer of €173 billion of risk assets and non-strategic business units from Hypo Real Estate Group (HRE).

Another similar transaction early in 2010 saw the firm advise Abwicklungsanstalt (EAA) on assuming €71 billion worth of assets from WestLB and some of its subsidiaries. The assets were transferred to EAA in April 2010 with retroactive effect as of 1 January 2010.

The firm was also active for News Corporation on the sale of its Berlin based subsidiary Fox Mobile Group to the financial investor Jesta.

A notable deal saw Skadden Arps Slate Meagher & Flom advise Apax Partners on the €920 million sale of a majority stake in German IFCO Systems to the Australian Brambles. The transaction between the two logistics companies closed in April 2011.

Johannes Kremer led a team representing Tele Columbus Group in its successful restructuring by means of a debt transfer and debt-for-equity swap which closed in January 2011. The deal involved several schemes of arrangement between four of the German operating companies within the Tele Columbus Group and the group's senior, second lien and mezzanine lenders.

Another notable deal saw the firm advise the shareholders of German pharmaceutical company Süd-Chemie, which was acquired for €2 billion by Clariant in February 2011.

Partner Philipp Windemuth left White & Case in October 2010 for Orrick, Herrington & Sutcliffe but the firm has since hired Lars Böttcher from Oppenhoff & Partner.

The firm was involved in Swiss chemical group Clariant's acquisition of German-based Süd-Chemie. Markus Hauptmann led a team on the €2 billion deal.

The aerospace sector kept Philipp Graf von Dürckheim busy in 2010. He was lead counsel for the firm when it advised Jenoptik on the sale of its subsidiary space division Jena-Optronik to Astrium, a global leader in the industry.

White & Case also acted as lead counsel for Finnish client UPM, the paper manufacturer, in its acquisition of Myllykoski Group and Rhein Papier for a combined total of €900 million. A follow-on instruction saw the firm advise on the restructuring of Myllykoski Group and Rhein Papier.

Noerr, which opened its first London office in October 2010, has been active for car manufacturer Daimler advising on setting up a joint venture, Mercedes Benz Trucks Vostok with Kamaz, with Russian truck maker Kamaz. The deal closed in August 2010.

On the buy side, the firm advised Chinese holding company Ningbo Joyson Investment on the acquisition of 74% of the automotive supplier Preh from the existing shareholders Deutsche Beteiligungs.

More recently, partner Laurenz Wieneke advised TAG Immobilien on the voluntary takeover of Colonia Real Estate for €200 million in January 2011.

Joint managing partner of the Shearman & Sterling's German offices, Harald Selzner, advised Munksjö paper producer on the acquisition of the speciality paper business of English listed company Arjowiggins.

M&A partner Marco Sustmann has also been active for the firm, leading a team on acquisition of a 9.1% stake in the share capital of construction company Hochtief for the Qatar Holding Company in December 2010.

The market sees Sullivan & Cromwell as more focused on equity capital markets work than M&A: "The two main guys [Wolfgang Feuring and Carsten Berrar] are more capital markets guys than M&A. They are involved in high-profile deals but their practice has certain limits," observes one M&A lawyer.

Despite competitors' reservations the pair has, individually, been active on some significant transactions in the last 12 months. Most recently Feuring was advising on the German aspects of US telecommunication company AT&T's $39 billion acquisition of T-Mobile USA from Deutsche Telekom.

In April 2011, Berrar was advising Intercontinental Exchange and NASDAQ OMX Group on a joint proposal to acquire NYSE Euronext for $11.3 billion. The offer has since been rescinded as it became clear the buyers would not be granted regulatory approval.

On a transaction which closed successfully, Berrar was involved in Daimler and Rolls-Royce's takeover of German engine producer Tognum via the jointly controlled entity Engine Holding. The firm's client was Goldman Sachs, financial advisor to Daimler on the €3.2 billion deal.

The most recent notable transaction undertaken by Weil Gotshal & Manges' M&A team was acting in conjunction with a number of the firm's European offices to advise French IT services group Atos Origin on its agreement to take over Siemens IT Solutions and Services. The €850 million deal was signed in July 2011.

In some crisis-driven work, partner Gerhard Schmidt was active for Wilhelm Karmann, the holding company of insolvent German automotive supplier of the same name, in connection with the sale of the Karmann car top systems unit to Valmet Automotive, a Finnish service automotive service provider.

The Munich and Frankfurt offices of Weil were also advised MorphoSys on the acquisition of the German biotechnology company Sloning BioTechnology in October 2010.

Joint managing partners at Fried Frank's Frankfurt office Jürgen van Kann and Sven Schulte-Hillen have led on all the firm's notable M&A matters recently.

For client Avantor Performance Materials and New Mountain Capital, van Kann advised on the acquisition of chemical manufacturer RFCL from ICICI Venture Funds Management Company.

The AEA group has been Schulte-Hillen occupied of late providing advice to AEA Investors in the sale of Convenience Food Systems to GEA Group for €435 million and a further deal saw him lead a team representing Houghton International, a portfolio company of AEA Investors, in its acquisition of subsidiaries and other assets of the global metal and oils business of the Royal Dutch Shell Group.

The corporate team at Gibson Dunn have been active across a range of sectors during the past year.

On the clean technology side, the firm advised the investment arm of the Singapore Development Board regarding its buy-in to German cleantech company Triton Water, which was completed in November 2010.

In an ongoing mandate involving two financial services companies, the firm acted for Giesecke & Devrient in the formation of a joint venture with Wincor Nixdorf, a manufacturer of solutions for cash handling processes in the banking and retail industry.

The automotive industry provided a further matter for the firm when it was mandated by EP Management Corporation in the sale of Wolverine Advance Materials, a manufacturer of speciality materials used in gaskets to Wynnchurch Capital, a private equity firm.

Heisse Kursawe Eversheds corporate practise head Matthias Heisse acted on the firm's most substantial M&A deal in the last 12 months leading a team advising Tognum which was subject to a €3 billion public takeover bid by Daimler and Rolls-Royce.

Christof Lamberts heads the international M&A practice at the firm and advised UK-based chemicals manufacturer, Croda International, on the sale of its oleo-chemicals business in Germany for €60 million in August 2010.

Joint head of Kirkland & Ellis' M&A practice Volker Kullmann was mandated on one of the year's largest deals: acting for Teva Pharmaceuticals Industries in its €3.6 billion acquisition of Ratiopharm, which manufactures similar products, from the Merckle group in August 2010.

Kirkland also advised Sunrise Senior Living and the company's German subsidiaries in the sale of nine senior residences located in Germany. Eight were sold in June 2010 and final one was purchased in October.

US based McDermott Will & Emery launched its Düsseldorf and Munich offices in 2002.

On the sell side, Belte mandated the firm to assist in two deals: the sale of its metal foundry Huth & Gaddum, and its wheel machining business. The deals closed in January and February respectively.

On the buy side, the Los Angeles based practice acted for Catella Real Estate Kapitalgesellschaft on the acquisition of several health service businesses.

In a further role the corporate team acted for client Humana Milchindustrie in its €1.5 billion merger with Nordmilch.

Perception of Milbank Tweed Hadley & McCloy's M&A practice is inconsistent. Some peers consider it a contender for the rankings while others argue it is predominantly focused on private equity. Although in the latter area the firm is stronger it has secured several significant M&A mandates.

Peers recommend Norbert Rieger. One of the two corporate founding partners of Milbank's Munich office, Rieger leads the practice with Peter Nussbaum.

A headline deal for the firm saw Rieger lead a team to advise NYSE Euronext on the much anticipated merger with Deutsche Börse. Elsewhere, acting for ProSiebenSat.1 Media, Rieger advised on the sale of TV broadcaster N24 and the production company MAZ&MORE.

In a further deal the firm acted for car rental company SIXT in establishing a car sharing joint venture with BMW.

P+P Pöllath + Partners has its fans. "P + P are very strong," says one competitor, adding: "they do a really good job". The firm is renowned for representing management in private equity deals and this is where peers say it excels, but there are doubts over the firm's straightforward M&A capabilities.

The corporate group has expanded significantly in 2011 with the appointment of Jan Wildberger as partner, Eva Nase as counsel and six new associates.

Watson, Farley & Williams advised Allianz Specialised Investments on the acquisition of two German wind farms from Isle of Man-based REH Renewable Energy and a German onshore wind farm from German developer Denker & Wulf.

The firm also acted for the Hamburg Trust Grundvermögen und Anlage in purchasing real estate and real estate development projects.

2007 saw a veritable exodus of lawyers from Clifford Chance's Frankfurt office to Willkie Farr & Gallagher's respective practice, with two counsel, three associates and partner Mario Schmidt, who now heads up the latter's corporate group, defecting.

In 2011, however, another magic circle firm - Allen & Overy - swooped for one of Willkie Farr & Gallagher's partners. Formerly with Linklaters, Michael Bernhardt, who joined the US firm in 2006, made his most recent switch in June. Before leaving, Bernhardt advised solar energy companyRoth & Rau on the sale of RHM Group to Waterland, closing the deal in April 2011.

With sales of solar panels expected to boom as Chinese manufacturers, some of the world's leading suppliers, announce intentions to cut costs, practice head Schmidt acted for Roth & Rau the aforementioned client, advising on its $516 million public take over by Swiss company Meyer Burger Technology in May 2011.

Further deals saw the firm advise Arkema on the acquisition of Total's Resins Business Unit and assist France Telecom Orange on establishing a joint venture with Deutsche Telekom. Both deals closed in April 2011.